Exhibit 10.11
SECOND AMENDMENT TO THE
C&D TECHNOLOGIES SAVINGS PLAN
THIS SECOND AMENDMENT is made on November 20, 2002, by C&D TECHNOLOGIES,
INC., a corporation duly organized and existing under the laws of the State of
Delaware (the "Company").
W I T N E S S E T H:
WHEREAS, the Company maintains the C&D Technologies Savings Plan (the
"Plan"), which was originally established by indenture dated February 1, 1986,
and was last amended and restated by indenture dated February 13, 2002;
WHEREAS, the Company desires to amend the Plan to reflect certain
provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001
("EGTRRA");
WHEREAS, the relevant provisions of this amendment are intended as good
faith compliance with the requirements of EGTRRA and are to be construed in
accordance with EGTRRA and any guidance issued thereunder; and
WHEREAS, this amendment shall supersede the provisions of the Plan to the
extent those provisions are inconsistent with the provisions of this amendment.
NOW, THEREFORE, effective as of January 1, 2002, except where otherwise
provided herein, the Plan is hereby amended as follows:
1. By deleting Section 1.5 in its entirety and substituting therefor the
following:
"1.5 'ANNUAL COMPENSATION LIMIT' means $200,000, which amount may be
adjusted in subsequent Plan Years based on changes in the cost of living as
announced by the Secretary of Treasury."
2. By adding the following new Section 1.5A:
"1.5A 'APPEALS FIDUCIARY' means an individual or group of individuals
appointed to review appeals of claims for benefits payable due to a
Participant's Disability made pursuant to Section 13.4."
3. By deleting the existing Section 1.13 and substituting therefor the
following:
"1.13 'DISABILITY' means a disability of a Participant within the meaning
of Code Section 72(m)(7), to the extent that the Participant is, or would be,
entitled to disability retirement benefits under the federal Social Security
Act. The determination of whether or not a Disability exists shall be determined
by the Plan Administrator and shall be substantiated by competent medical
evidence."
4. By deleting the existing Section 1.17 and substituting therefor the
following:
"1.17 'ELIGIBLE RETIREMENT PLAN' means (a) an individual retirement account
described in Code Section 408(a); (b) an individual retirement annuity described
in Code Section 408(b); (c) an annuity plan described in Code Section 403(a) or
an annuity contract described in Code Section 403(b); (d) a qualified trust
described in Code Section 401(a) that accepts the Distributee's Eligible
Rollover Distribution; or (e) an eligible deferred compensation plan under Code
Section 457(b) which is maintained by a state, political subdivision and which
agrees to separately account for amounts transferred into such plan from this
Plan."
5. By deleting the existing Section 1.28 and substituting therefor the
following:
"1.28 'NAMED FIDUCIARY' means only the following:
(a) the Plan Administrator;
(b) the Trustee;
(c) the Investment Manager;
(d) the Pension Committee; and
(e) the Appeals Fiduciary."
6. By deleting the existing Section 1.37 and substituting therefor the
following:
"1.37 'ROLLOVER AMOUNT' means any amount transferred to the Fund by a
Participant, which amount qualifies as an Eligible Rollover Distribution under
Code Section 402(c)(4), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16),
and any regulations issued thereunder."
7. By deleting the existing Section 1.41 and substituting therefor the
following:
"1.41 'TERMINATION OF EMPLOYMENT' means a severance from employment (within
the meaning of Code Section 401(k)(2)(B)(i)(I)) of an Employee from all Plan
Sponsors and Affiliates for any reason other than death, Disability, or
attainment of a Retirement Date. Any absence from active employment of the Plan
Sponsor and Affiliates by reason of an approved leave of absence shall not be
deemed for any purpose under the Plan to be a Termination of Employment.
Transfer of an Employee from one Plan Sponsor to another Plan Sponsor or to an
Affiliate shall not be deemed for any purpose under the Plan to be a Termination
of Employment. In addition, transfer of an Employee to another employer (other
than a Plan Sponsor or an Affiliate) in connection with a corporate transaction
involving a sale of assets, merger, or sale of stock, shall not be deemed to be
a Termination of Employment, for purposes of the timing of distributions under
Section 8.1, if the employer to which such Employee is transferred agrees with
the Plan Sponsor to accept a transfer of assets from the Plan to its
tax-qualified plan in a trust-to-trust transfer meeting the requirements of Code
Section 414(l)."
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8. By deleting the existing Sections 3.1(b) and 3.1(c) and substituting
therefor the following:
"(b) DEFERRAL AMOUNTS. The Plan Sponsor shall make a contribution to
the Fund on behalf of each Participant who is an Eligible Employee and who
either is deemed to have elected pursuant to this Section 3.1(b)(1) or has
affirmatively elected pursuant to this Section 3.1(b)(2) to defer a portion
of his Annual Compensation otherwise payable to him for the Plan Year and
to have such portion contributed to the Fund.
(1) Any Eligible Employee who has completed the eligibility
requirements of Section 2 and who fails to make an affirmative election
pursuant to Plan Section 3.1(b)(2) shall be deemed to have made an
election to contribute three percent (3%) of the Eligible Employee's
Annual Compensation to the Plan unless the Eligible Employee elects not
to defer any portion of his Annual Compensation pursuant to Section 3.1.
If an Eligible Employee makes the election under this Section 3.1(b)(1)
not to contribute to the Plan, the Eligible Employee may later elect to
contribute to the Plan pursuant to Section 3.1(b)(2).
(2) Except to the extent permitted under Section 3.1(d) and Code
Section 414(v), the contribution made by a Plan Sponsor on behalf of a
Participant under this Section 3.1(b)(2) shall be in an amount equal to
the amount specified in the Participant's deferral election, but not
greater than fifty percent (50%) of the Participant's Annual
Compensation, or if the Participant is automatically enrolled pursuant
to Plan Section 3.1(a)(1), the contribution shall be three percent (3%)
of the Participant's Annual Compensation. Pursuant to Section 4 of
Appendix C, the Plan Administrator may restrict the amount which Highly
Compensated Employees may defer under this Section 3.1(b).
(c) Limit on Deferral Amounts. Except to the extent permitted under
Section 3.1(d) and Code Section 414(v), Elective Deferrals shall in no
event exceed the limit set forth in Code Section 402(g) in any one taxable
year of the Participant. In the event the amount of Elective Deferrals
exceeds the Code Section 402(g) limit in any one taxable year then,
(1) not later than the immediately following March 1, the
Participant may designate to the Plan the portion of the Participant's
Deferral Amounts which consists of excess Elective Deferrals, and
(2) not later than the immediately following April 15, the Plan may
distribute the amount designated to it under Paragraph (1) above, as
adjusted to reflect income, gain, or loss attributable to it through the
end of the Plan Year, and reduced by any `Excess Deferral Amounts,' as
defined in Appendix C hereto, previously distributed or recharacterized
with respect to the Participant for the Plan Year beginning with or
within that taxable year.
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The payment of the excess Elective Deferrals, as adjusted and reduced,
from the Plan shall be made to the Participant without regard to any other
provision in the Plan. In the event that a Participant's Elective Deferrals
exceed the Code Section 402(g) limit in any one taxable year under the Plan
and other plans of the Plan Sponsor and its Affiliates, the Participant
shall be deemed to have designated for distribution under the Plan the
amount of excess Elective Deferrals, as adjusted and reduced, by taking
into account only Elective Deferral amounts under the Plan and other plans
of the Plan Sponsor and its Affiliates.
(d) CATCH-UP CONTRIBUTIONS. A Participant who is eligible to
contribute Deferral Amounts to the Plan and who has attained age 50 on or
before the last day of the Plan Year shall be eligible to elect to have a
portion of his Annual Compensation otherwise payable to him for the Plan
Year contributed by the Plan Sponsor to the Fund on his behalf as catch-up
contributions in accordance with and subject to the limitations of, Code
Section 414(v). Contributions made pursuant to this Section 3.1(d) shall
not be taken into account for purposes of implementing the limitations set
forth in Section 3.1(b), 3.1(c) and Appendix A hereto. The Plan shall not
be treated as failing to satisfy the provisions of Appendix B, Appendix C
or Code Section 410(b), as applicable, by reason of the making of the
catch-up contributions as described in this Section 3.1(d).
(e) ALLOCATION OF CONTRIBUTIONS. Contributions made pursuant to this
Section 3.1 shall be allocated to the Employee Deferral Account of the
Participant on whose behalf they were made as soon as reasonably
practicable following the date of withholding by the Plan Sponsor and
receipt by the Trustee.
(f) DEFERRAL ELECTIONS. The elections under this Section 3.1 must be
made before the Annual Compensation is payable and may only be made in such
manner and subject to such rules and limitations as the Plan Administrator
may prescribe and shall specify the percentage or dollar amount, as
applicable, of Annual Compensation that the Participant desires to defer
pursuant to Section 3.1(b) and/or 3.1(d) and to have contributed to the
Fund. Once a Participant has made an election for a Plan Year, the
Participant may revoke or modify his election to increase or reduce the
rate of future deferrals, as provided in the administrative procedures
established by the Plan Administrator."
9. By deleting the existing Section 3.2(a) and substituting therefor the
following:
"(a) The Plan Sponsor proposes to make contributions to the Matching
Account for each Plan Year of each Participant who is an Eligible Employee
compensated by a Plan Sponsor on a salaried basis or employed in the Power
Electronics Division and who is entitled to an allocation under Plan
Section 4.1(a) in an amount equal to a percentage, to be determined by the
Plan Sponsor, of the Participant's Annual Compensation deferred by the
Participant pursuant to Plan Section 3.1(b) during any payroll period to
the extent the contribution under Section 3.1(b) does not exceed eight
percent (8%) of his Annual Compensation."
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10. By deleting the existing Section 3.7 and substituting therefor the
following:
"3.7 ROLLOVER CONTRIBUTIONS. Any Eligible Employee may, with the consent of
the Plan Administrator and subject to such rules and conditions as the Plan
Administrator may prescribe, transfer a Rollover Amount to the Fund (which may
include without limitation prohibitions against transferring certain categories
of Rollover Amounts to the Plan); provided, however, that the Plan Administrator
shall not administer this provision in a manner which is discriminatory in favor
of Highly Compensated Employees."
11. By deleting the existing Section 5.5 and substituting therefor the
following:
"5.5 Notwithstanding any provision of the Plan to the contrary, as to any
Participant who has not attained age 50 at the end of the Plan Year for which
the contribution is being made, the Trustee shall invest fifty percent (50%) of
the contribution made on behalf of a Participant under Plan Section 3.3(a)(ii)
and 3.3(a)(iii) and the portion of the contribution made on behalf of a
Participant under 3.3(b)(ii) that is equal to one-half of one percent (.5%) of
the Participant's Annual Compensation in Company Stock; provided, however, that
a Participant who has reached age 50 may elect to transfer any portion of his
Salaried Profit-Sharing Account or Hourly Profit-Sharing Account, as applicable,
that is invested in Company Stock to other Individual Funds. Any election must
be in accordance with the policies and procedures established by the Plan
Administrator."
12. By deleting existing header language to Section 7.1 and substituting
therefor the following:
"7.1 The Trustee shall, upon the direction of the Plan Administrator,
withdraw all or a portion of a Participant's Employee Deferral Account
consisting of Deferral Amounts, including catch-up contributions made pursuant
to Section 3.1(d) (but not earnings thereon), prior to the time such account is
otherwise distributable in accordance with the other provisions of the Plan;
provided, however, that any such withdrawal shall be made only if the
Participant is an Employee and demonstrates that he is suffering from 'hardship'
as determined herein. For purposes of this Section, a withdrawal will be deemed
to be an account of hardship if the withdrawal is on account of:"
13. By adding the word "and" to the end of Section 7.2(a)(1) and by
deleting the existing Section 7.2(a)(2) and substituting therefor the following:
"(2) the Plan Sponsor shall not permit Elective Deferrals, including
catch-up contributions as described in Code Section 414(v), or after-tax
employee contributions to be made to the Plan or any other plan maintained
by the Plan Sponsor, for a period of six (6) months after the Participant
receives the withdrawal pursuant to this Section."
14. By deleting the existing Section 7.2(a)(3) in its entirety.
15. By adding the phrase "his Matching Account," after the phrase "January
1, 2002," in Section 8.2(b)(ii).
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16. By deleting the existing Section 8.6 in its entirety.
17. By deleting Section 11.3(e) in its entirety and by substituting
therefor the following:
"(d) Distributions will be made in accordance with the regulations
under Code Section 401(a)(9) and the regulations issued thereunder,
including the incidental benefit requirements. Notwithstanding the
foregoing, effective as of January 1, 2003, any distributions pursuant to
Code Section 401(a)(9) shall be administered in accordance with Appendix D
hereto."
18. By adding the following new Section 12.8:
"12.8 APPEALS FIDUCIARY. The Primary Sponsor shall appoint an Appeals
Fiduciary. The Appeals Fiduciary shall be required to review claims for benefits
payable due to a Participant's Disability that are initially denied by the Plan
Administrator and for which the claimant requests a full and fair review
pursuant to Section 13.3. The Appeals Fiduciary may not be the individual who
made the initial adverse determination with respect to any claim he reviews and
may not be a subordinate of any individual who made the initial adverse
determination. The Appeals Fiduciary may be removed in the same manner in which
appointed or may resign at any time by written notice of resignation to the
Primary Sponsor. Upon such removal or resignation, the Primary Sponsor shall
appoint a successor."
19. By deleting the existing Section 13 of the Plan in its entirety and
substituting therefor the following:
"ARTICLE 13
CLAIMS REVIEW PROCEDURE
13.1 NOTICE OF DENIAL. If a Participant or a Beneficiary is denied a claim
for benefits under the Plan, the Plan Administrator shall provide to the
claimant written notice of the denial within ninety (90) days (forty-five (45)
days with respect to a denial of any claim for benefits due to the Participant's
Disability) after the Plan Administrator receives the claim, unless special
circumstances require an extension of time for processing the claim. If such an
extension of time is required, written notice of the extension shall be
furnished to the claimant prior to the termination of the initial 90-day period.
In no event shall the extension exceed a period of ninety (90) days (thirty (30)
days with respect to a claim for benefits due to the Participant's Disability)
from the end of such initial period. With respect to a claim for benefits due to
the Participant's Disability, an additional extension of up to thirty (30) days
beyond the initial 30-day extension period may be required for processing the
claim. In such event, written notice of the extension shall be furnished to the
claimant within the initial 30-day extension period. Any extension notice shall
indicate the special circumstances requiring the extension of time, the date by
which the Plan Administrator expects to render the final decision, the standards
on which entitlement to benefits are based, the unresolved issues that prevent a
decision on the claim and the additional information needed to resolve those
issues.
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13.2 CONTENTS OF NOTICE OF DENIAL. If a Participant or Beneficiary is
denied a claim for benefits under a Plan, the Plan Administrator shall provide
to such claimant written notice of the denial which shall set forth:
(a) the specific reasons for the denial;
(b) specific references to the pertinent provisions of the Plan on
which the denial is based;
(c) a description of any additional material or information necessary
for the claimant to perfect the claim and an explanation of why such
material or information is necessary;
(d) an explanation of the Plan's claim review procedures, and the time
limits applicable to such procedures, including a statement of the
claimant's right to bring a civil action under Sections 502(a) of ERISA
following an adverse benefit determination on review;
(e) in the case of a claim for benefits due to a Participant's
Disability, if an internal rule, guideline, protocol or other similar
criterion is relied upon in making the adverse determination, either the
specific rule, guideline, protocol or other similar criterion; or a
statement that such rule, guideline, protocol or other similar criterion
was relied upon in making the decision and that a copy of such rule,
guideline, protocol or other similar criterion will be provided free of
charge upon request; and
(f) in the case of a claim for benefits due to a Participant's
Disability, if a denial of the claim is based on a medical necessity or
experimental treatment or similar exclusion or limit, an explanation of the
scientific or clinical judgment for the denial, an explanation applying the
terms of the Plan to the claimant's medical circumstances or a statement
that such explanation will be provided free of charge upon request.
13.3 RIGHT TO REVIEW. After receiving written notice of the denial of a
claim or that a domestic relations order is a qualified domestic relations
order, a claimant or his representative shall be entitled to:
(a) request a full and fair review of the denial of the claim or
determination that a domestic relations order is a qualified domestic
relations order by written application to the Plan Administrator (or
Appeals Fiduciary in the case of a claim for benefits payable due to a
Participant's Disability);
(b) request, free of charge, reasonable access to, and copies of, all
documents, records, and other information relevant to the claim;
(c) submit written comments, documents, records, and other information
relating to the denied claim to the Plan Administrator or Appeals
Fiduciary, as applicable; and
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(d) a review that takes into account all comments, documents, records,
and other information submitted by the claimant relating to the claim,
without regard to whether such information was submitted or considered in
the initial benefit determination.
13.4 APPLICATION FOR REVIEW.
(a) If a claimant wishes a review of the decision denying his claim to
benefits under the Plan, other than a claim described in Subsection (b) of
this Section 13.4, or if a claimant wishes to appeal a decision that a
domestic relations order is a qualified domestic relations order, he must
submit the written application to the Plan Administrator within sixty (60)
days after receiving written notice of the denial or notice that the
domestic relations order is a qualified domestic relations order.
(b) If the claimant wishes a review of the decision denying his claim
to benefits under the Plan due to a Participant's Disability, he must
submit the written application to the Appeals Fiduciary within one hundred
eighty (180) days after receiving written notice of the denial. With
respect to any such claim, in deciding an appeal of any denial based in
whole or in part on a medical judgment (including determinations with
regard to whether a particular treatment, drug, or other item is
experimental, investigational, or not medically necessary or appropriate),
the Appeals Fiduciary shall
(i) consult with a health care professional who has appropriate
training and experience in the field of medicine involved in the
medical judgment; and
(ii) identify the medical and vocational experts whose advice was
obtained on behalf of the Plan in connection with the denial without
regard to whether the advice was relied upon in making the
determination to deny the claim.
Notwithstanding the foregoing, the health care professional consulted
pursuant to this Subsection (b) shall be an individual who was not
consulted with respect to the initial denial of the claim that is the
subject of the appeal or a subordinate of such individual.
13.5 HEARING. Upon receiving such written application for review, the Plan
Administrator or Appeals Fiduciary, as applicable, may schedule a hearing for
purposes of reviewing the claimant's claim, which hearing shall take place not
more than thirty (30) days from the date on which the Plan Administrator or
Appeals Fiduciary received such written application for review.
13.6 NOTICE OF HEARING. At least ten (10) days prior to the scheduled
hearing, the claimant and his representative designated in writing by him, if
any, shall receive written notice of the date, time, and place of such scheduled
hearing. The claimant or his representative, if any, may request that the
hearing be rescheduled, for his convenience, on another reasonable date or at
another reasonable time or place.
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13.7 COUNSEL. All claimants requesting a review of the decision denying
their claim for benefits may employ counsel for purposes of the hearing.
13.8 DECISION ON REVIEW. No later than sixty (60) days (forty-five (45)
days with respect to a claim for benefits due to the Participant's Disability)
following the receipt of the written application for review, the Plan
Administrator or the Appeals Fiduciary, as applicable, shall submit its decision
on the review in writing to the claimant involved and to his representative, if
any, unless the Plan Administrator or Appeals Fiduciary determines that special
circumstances (such as the need to hold a hearing) require an extension of time,
to a day no later than one hundred twenty (120) days (ninety (90) days with
respect to a claim for benefits due to the Participant's Disability) after the
date of receipt of the written application for review. If the Plan Administrator
or Appeals Fiduciary determines that the extension of time is required, the Plan
Administrator or Appeals Fiduciary shall furnish to the claimant written notice
of the extension before the expiration of the initial sixty (60) day (forty-five
(45) days with respect to a claim for benefits due to the Participant's
Disability) period. The extension notice shall indicate the special
circumstances requiring an extension of time and the date by which the Plan
Administrator or Appeals Fiduciary expects to render its decision on review. In
the case of a decision adverse to the claimant, the Plan Administrator or
Appeals Fiduciary shall provide to the claimant written notice of the denial
which shall include:
(a) the specific reasons for the decision;
(b) specific references to the pertinent provisions of the Plan on
which the decision is based;
(c) a statement that the claimant is entitled to receive, upon request
and free of charge, reasonable access to, and copies of, all documents,
records, and other information relevant to the claimant's claim for
benefits;
(d) an explanation of the Plan's claim review procedures, and the time
limits applicable to such procedures, including a statement of the
claimant's right to bring an action under Section 502(a) of ERISA following
the denial of the claim upon review;
(e) in the case of a claim for benefits due to the Participant's
Disability, if an internal rule, guideline, protocol or other similar
criterion is relied upon in making the adverse determination, either the
specific rule, guideline, protocol or other similar criterion; or a
statement that such rule, guideline, protocol or other similar criterion
was relied upon in making the decision and that a copy of such rule,
guideline, protocol or other similar criterion will be provided free of
charge upon request;
(f) in the case of a claim for benefits due to a Participant's
Disability, if a denial of the claim is based on a medical necessity or
experimental treatment or similar exclusion or limit, an explanation of the
scientific or clinical judgment for the denial, an explanation applying the
terms of the Plan to the claimant's medical circumstances or a statement
that such explanation will be provided free of charge upon request; and
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(g) in the case of a claim for benefits due to a Participant's
Disability, a statement regarding the availability of other voluntary
alternative dispute resolution options."
20. By deleting the existing Section 20 of the Plan in its entirety and
substituting therefor the following:
"SECTION 20
INCORPORATION OF SPECIAL LIMITATIONS
Appendices A, B, C and D to the Plan, attached hereto, are incorporated by
reference and the provisions of the same shall apply notwithstanding anything to
the contrary contained herein."
21. By deleting the existing Section 1 of Appendix A and substituting
therefor the following:
"Except to the extent permitted under Plan Section 3.1(d) and Code Section
414(v), if applicable, the 'annual addition' for any Member for any one
limitation year may not exceed the lesser of:
(a) $40,000, as adjusted under Code Section 415(d); or
(b) 100% of the Member's Annual Compensation.
The limit described in Subsection (b) shall not apply to any contribution
for medical benefits after separation from service (within the meaning of Code
Section 401(h) or 419A(f)(2)) which is otherwise treated as an annual addition."
22. By deleting the existing Section 2 of Appendix A and substituting
therefor the following:
"For the purposes of this Appendix A, the term `annual addition' for
any Participant means for any limitation year, the sum of certain Plan
Sponsor, Affiliate and Participant contributions and forfeitures , as
determined in Code Section 415(c)(2) in effect for that limitation year.
Participant contributions shall be determined without regard to Rollover
Amounts, employee contributions to a simplified employee pension which are
excludable from gross income under Code Section 408(k)(6), and catch-up
contributions as described in Code Section 414(v)."
23. By adding the following new Subsection (g) to the end of the existing
Section 6 of Appendix A:
"(g) Notwithstanding anything contained in the Plan to the contrary,
the Plan Administrator may modify the provisions of this Section 6 with
respect to reduction of
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Participant's accounts in accordance with such procedures as the Plan
Administrator may establish with respect to catch-up contributions
described in Code Section 414(v)."
24. By deleting the existing Section 1(b) of Appendix B and substituting
therefor the following:
"(b) 'Key Employee' means an Employee or former Employee (including
Beneficiary of a Key Employee or former Key Employee) who at any time
during the Plan Year containing the Determination Date was:
(1) an officer of the Plan Sponsor or any Affiliate whose Annual
Compensation was greater than $130,000 (as adjusted for changes in the
cost of living as provided in regulations issued by the Secretary of
the Treasury for Plan Years beginning after December 31, 2002) for the
calendar year in which the Plan Year ends, where the term 'officer'
means an administrative executive in regular and continual service to
the Plan Sponsor or an Affiliate; provided, however, that in no event
shall the number of officers exceed the lesser of (A) fifty (50)
employees; or (B) the greater of (I) three (3) employees or (II) ten
percent (10%) of the number of Employees during the Plan Year, with
any non-integer being increased to the next integer. If for any year,
no officer of the Plan Sponsor meets the requirements of this
Subparagraph (1), the highest paid officer of the Plan Sponsor for the
Plan Year shall be considered an officer for purposes of this
Subparagraph (1);
(2) an owner of more than five percent (5%) of the outstanding
stock of the Plan Sponsor or an Affiliate or more than five percent
(5%) of the total combined voting power of all stock of the Plan
Sponsor or an Affiliate; or
(3) an owner of more than one percent (1%) of the outstanding
stock of the Plan Sponsor or an Affiliate or more than one percent
(1%) of the total combined voting power of all stock of the Plan
Sponsor or an Affiliate, and who in such Plan Year had Annual
Compensation from the Plan Sponsor and all of its Affiliates of more
than $150,000.
For purposes of determining ownership under Subsections (2) and (3)
above, the rules set forth in Code Section 318(a)(2) shall be applied as
follows (i) in the case of any Plan Sponsor or Affiliate which is a
corporation, by substituting five percent (5%) for fifty percent (50%) and,
(ii) in the case of any Plan Sponsor or Affiliate which is not a
corporation, ownership in such Plan Sponsor or Affiliate shall be
determined in accordance with Treasury Regulations which shall be based on
principles similar to the principles of Code Section 318(a)(2) (as modified
by Clause (i) above).
Employees other than Key Employees are sometimes referred to in this
Appendix B as 'non-key employees.'"
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25. By deleting the existing Subsection (d)(1)(A)(i) of Section 1 of
Appendix B and substituting therefor the following:
"(i) the present value of the cumulative Accounts (excluding catch-up
contributions as described in Code Section 414(v) made in the Plan Year for
which the determination is being made) under the Plan for all Key Employees
exceeds sixty percent (60%) of the present value of the cumulative Accounts
(excluding catch-up contributions as described in Code Section 414(v) made
in the Plan Year for which the determination is being made) under the Plan
for all Participants; and"
26. By deleting Section 1(d)(3)(C) of Appendix B of the Plan and
substituting therefor the following:
"(C) For purposes of determining the present value of the cumulative
accrued benefit under a plan for any Participant in accordance with this
Subsection, the present value shall be increased by the aggregate
distributions made with respect to the Participant (including distributions
paid on account of death to the extent they do not exceed the present value
of the cumulative accrued benefit existing immediately prior to death)
under each plan being considered, and under any terminated plan which if it
had not been terminated would have been in a Required Aggregation Group
with the Plan, during the one-year period ending on the Determination Date
or the last day of the Plan Year that falls within the calendar year in
which the Determination Date falls. In the case of a distribution made with
respect to a Participant made for a reason other than separation from
service, death, or disability, this provision shall applied by substituting
the five-year period for the one-year period."
27. By deleting Section 1(d)(3)(F) of Appendix B of the Plan and
substituting therefor the following:
"(F) For purposes of this Paragraph (3), if any Employee has not
performed any service for any Plan Sponsor or Affiliate maintaining the
plan during the one-year period ending on the Determination Date, any
accrued benefit for that Employee shall not be taken into account."
28. By deleting the existing Section (b)(1) of Section 2 of Appendix B and
substituting therefor the following:
"(1) The percentage referred to in Subsection (a) of this Section for
any Plan Year shall not exceed the percentage at which allocations are made
or are required to be made under the Plan for the Plan Year for the Key
Employee for whom the percentage is highest for a Plan Year. For purposes
of this Paragraph, an allocation to the Account of a Key Employee resulting
from any Plan Sponsor contribution attributable to a salary reduction or
similar agreement shall be taken into account but allocations of catch-up
contributions as described in Code Section 414(v) shall not be taken into
account."
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29. By deleting the next to the last sentence of the first paragraph of
Section 3 of Appendix C to the Plan.
30. By deleting the existing Section 4 of Appendix C to the Plan and
substituting therefor the following:
"The Plan Administrator shall have the responsibility of monitoring the
Plan's compliance with the limitations of this Appendix C and shall have the
power to take all steps it deems necessary or appropriate to ensure compliance,
including, without limitation, restricting the amount which Highly Compensated
Eligible Members can elect to have contributed pursuant to Section 3.1(a). Any
actions taken by the Plan Administrator pursuant to this Section 4 shall be
pursuant to non-discriminatory procedures consistently applied."
31. By deleting the existing second, third and fourth sentences of the last
paragraph of Section 5 of Appendix C to the Plan and substituting therefor the
following:
"The 'contribution percentage' for Highly Compensated Eligible
Participants and for all other Eligible Participants for a Plan Year
shall be the average of the ratios, calculated separately for each
Participant, of (A) to (B), where (A) is the amount of Matching
Contributions under the Plan (excluding Qualified Matching
Contributions which are used to apply the test set forth in Section 2
of this Appendix C) and nondeductible employee contributions made under
the Plan for the Eligible Participant for the Plan Year, and where (B)
is the Annual Compensation of the Eligible Participant for the Plan
Year."
32. Effective January 1, 2003, by adding the following new Appendix D to
the Plan:
"APPENDIX D
MINIMUM DISTRIBUTION REQUIREMENTS
SECTION 1
GENERAL RULES
(a) EFFECTIVE DATE AND PRECEDENCE. The provisions of this Appendix D
will apply for purposes of determining required minimum distributions for
calendar years beginning with the 2003 calendar year. The requirements of
this Appendix D will take precedence over any inconsistent provisions of
the Plan.
(b) REQUIREMENTS OF TREASURY REGULATIONS INCORPORATED. All
distributions required under this Section will be determined and made in
accordance with the Treasury Regulations under Code Section 401(a)(9).
(c) TEFRA SECTION 242(b)(2) ELECTIONS. Notwithstanding the other
provisions of this Appendix D, distributions may be made under a
designation made before January 1, 1984, in accordance with Section
242(b)(2) of the Tax Equity and Fiscal
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Responsibility Act (TEFRA) and the provisions of the Plan that relate to
Section 242(b)(2) of TEFRA.
SECTION 2
TIME AND MANNER OF DISTRIBUTION
(a) REQUIRED BEGINNING DATE. The Participant's entire interest will be
distributed, or begin to be distributed, to the Participant no later than
the Participant's Required Beginning Date.
(b) DEATH OF PARTICIPANT BEFORE DISTRIBUTIONS BEGIN. If the
Participant dies before distributions begin, the Participant's entire
interest will be distributed, or begin to be distributed, no later than as
follows:
(1) If the Participant's surviving spouse is the Participant's
sole Designated Beneficiary, then, distributions to the surviving
spouse will begin by December 31 of the calendar year immediately
following the calendar year in which the Participant died, or by
December 31 of the calendar year in which the Participant would have
attained age 70 1/2, if later.
(2) If the Participant's surviving spouse is not the
Participant's sole Designated Beneficiary, then, distributions to the
Designated Beneficiary will begin by December 31 of the calendar year
immediately following the calendar year in which the Participant died.
(3) If there is no Designated Beneficiary as of September 30 of
the year following the year of the Participant's death, the
Participant's entire interest will be distributed by December 31 of
the calendar year containing the fifth anniversary of the
Participant's death.
(4) If the Participant's surviving spouse is the Participant's
sole Designated Beneficiary and the surviving spouse dies after the
Participant but before distributions to the surviving spouse begin,
this Section 2(b), other than Section 2(b)(1) of this Appendix D, will
apply as if the surviving spouse were the Participant.
For purposes of this Section 2(b) and Section 4 of this Appendix D,
unless Section 2(b)(4) of this Appendix D applies, distributions are
considered to begin on the Participant's Required Beginning Date. If
Section 2(b) of this Appendix D applies, distributions are considered to
begin on the date distributions are required to begin to the surviving
spouse under Section 2(b)(1) of this Appendix D. If distributions under an
annuity purchased from an insurance company irrevocably commence to the
Participant before the Participant's Required Beginning Date (or to the
Participant's surviving spouse before the date distributions are required
to begin to the surviving spouse under Section 2(b)(1)), the date
distributions are considered to begin is the date distributions actually
commence.
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(c) Forms of Distribution. Unless the Participant's interest is distributed
in the form of an annuity purchased from an insurance company or in a single sum
on or before the Required Beginning Date, as of the first Distribution Calendar
Year, distributions will be made in accordance with Sections 3 and 4 of this
Appendix D. If the Participant's interest is distributed in the form of an
annuity purchased from an insurance company, distributions thereunder will be
made in accordance with the requirements of Code Section 401(a)(9) and the
regulations issued thereunder.
SECTION 3
REQUIRED MINIMUM DISTRIBUTIONS DURING PARTICIPANT'S LIFETIME
(a) AMOUNT OF REQUIRED MINIMUM DISTRIBUTION FOR EACH DISTRIBUTION CALENDAR
YEAR. During the Participant's lifetime, the minimum amount that will be
distributed for each Distribution Calendar Year is the lesser of:
(1) the quotient obtained by dividing the Participant's Account
Balance by the distribution period in the Uniform Lifetime Table set forth
in Section 1.401(a)(9)-9 of the Treasury Regulations, using the
Participant's age as of the Participant's birthday in the Distribution
Calendar Year; or
(2) if the Participant's sole Designated Beneficiary for the
Distribution Calendar Year is the Participant's spouse, the quotient
obtained by dividing the Participant's Account Balance by the number in the
Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9 of the
Treasury Regulations, using the Participant's and spouse's attained ages as
of the Participant's and spouse's birthdays in the Distribution Calendar
Year.
(b) LIFETIME REQUIRED MINIMUM DISTRIBUTIONS CONTINUE THROUGH YEAR OF
PARTICIPANT'S DEATH. Required minimum distributions will be determined under
this Section 3 beginning with the first Distribution Calendar Year and up to and
including the Distribution Calendar Year that includes the Participant's date of
death.
SECTION 4
REQUIRED MINIMUM DISTRIBUTIONS AFTER PARTICIPANT'S DEATH
(a) DEATH ON OR AFTER DATE DISTRIBUTIONS BEGIN.
(1) PARTICIPANT SURVIVED BY DESIGNATED BENEFICIARY. If the Participant
dies on or after the date distributions begin and there is a Designated
Beneficiary, the minimum amount that will be distributed for each
Distribution Calendar Year after the year of the Participant's death is the
quotient obtained by dividing the Participant's Account Balance by the
longer of the remaining Life Expectancy of the Participant or the remaining
Life Expectancy of the Participant's Designated Beneficiary, determined as
follows:
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(i) The Participant's remaining Life Expectancy is calculated
using the age of the Participant in the year of death, reduced by one
for each subsequent year.
(ii) If the Participant's surviving spouse is the Participant's
sole Designated Beneficiary, the remaining Life Expectancy of the
surviving spouse is calculated for each Distribution Calendar Year
after the year of the Participant's death using the surviving spouse's
age as of the spouse's birthday in that year. For Distribution
Calendar Years after the year of the surviving spouse's death, the
remaining Life Expectancy of the surviving spouse is calculated using
the age of the surviving spouse as of the spouse's birthday in the
calendar year of the spouse's death, reduced by one for each
subsequent calendar year.
(iii) If the Participant's surviving spouse is not the
Participant's sole Designated Beneficiary, the Designated
Beneficiary's remaining Life Expectancy is calculated using the age of
the Designated Beneficiary in the year following the year of the
Participant's death, reduced by one for each subsequent year.
(2) NO DESIGNATED BENEFICIARY. If the Participant dies on or after the
date distributions begin and there is no Designated Beneficiary as of
September 30 of the year after the year of the Participant's death, the
minimum amount that will be distributed for each Distribution Calendar Year
after the year of the Participant's death is the quotient obtained by
dividing the Participant's Account Balance by the Participant's remaining
Life Expectancy calculated using the age of the Participant in the year of
death, reduced by one for each subsequent year.
(b) DEATH BEFORE DATE DISTRIBUTIONS BEGIN.
(1) PARTICIPANT SURVIVED BY DESIGNATED BENEFICIARY. If the Participant
dies before the date distributions begin and there is a Designated
Beneficiary, the minimum amount that will be distributed for each
Distribution Calendar Year after the year of the Participant's death is the
quotient obtained by dividing the Participant's Account Balance by the
remaining Life Expectancy of the Participant's Designated Beneficiary,
determined as provided in Section 4(a).
(2) NO DESIGNATED BENEFICIARY. If the Participant dies before the date
distributions begin and there is no Designated Beneficiary as of September
30 of the year following the year of the Participant's death, distribution
of the Participant's entire interest will be completed by December 31 of
the calendar year containing the fifth anniversary of the Participant's
death.
(3) DEATH OF SURVIVING SPOUSE BEFORE DISTRIBUTIONS TO SURVIVING SPOUSE
ARE REQUIRED TO BEGIN. If the Participant dies before the date
distributions begin, the Participant's surviving spouse is the
Participant's sole Designated
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Beneficiary, and the surviving spouse dies before distributions are
required to begin to the surviving spouse under Section 2(b)(1) of this
Appendix D, this Section (b) will apply as if the surviving spouse were the
Participant.
SECTION 5
DEFINITIONS
As used in this Appendix D, the following words and phrases shall have the
meaning set forth below:
(a) DESIGNATED BENEFICIARY. The individual who is designated as the
Beneficiary under Section 1.6 of the Plan and is the designated Beneficiary
under Section 401(a)(9) of the Internal Revenue Code and Section
1.401(a)(9)-1, Q&A-4, of the Treasury Regulations.
(b) DISTRIBUTION CALENDAR YEAR. A calendar year for which a minimum
distribution is required. For distributions beginning before the
Participant's death, the first distribution calendar year is the calendar
year immediately preceding the calendar year which contains the
Participant's Required Beginning Date. For distributions beginning after
the Participant's death, the first distribution calendar year is the
calendar year in which distributions are required to begin under Section
2(b). The required minimum distribution for the Participant's first
distribution calendar year will be made on or before the Participant's
Required Beginning Date. The required minimum distribution for other
distribution calendar years, including the required minimum distribution
for the distribution calendar year in which the Participant's Required
Beginning Date occurs, will be made on or before December 31 of that
distribution calendar year.
(c) LIFE EXPECTANCY. Life expectancy as computed by use of the Single
Life Table in Section 1.401(a)(9)-9 of the Treasury Regulations.
(d) PARTICIPANT'S ACCOUNT BALANCE. The Account balance as of the last
Valuation Date in the calendar year immediately preceding the Distribution
Calendar Year ("Valuation Calendar Year") increased by the amount of any
contributions made and allocated or forfeitures allocated to the Account
balance as of dates in the Valuation Calendar Year after the Valuation Date
and decreased by distributions made in the Valuation Calendar Year after
the Valuation Date. The Account balance for the Valuation Calendar Year
includes any amounts rolled over or transferred to the Plan either in the
Valuation Calendar Year or in the Distribution Calendar Year if distributed
or transferred in the Valuation Calendar Year.
(e) REQUIRED BEGINNING DATE. The date specified in Section 11.5(c) of
the Plan."
33. By deleting the last sentence of the first paragraph of Section 6 of
Appendix C to the Plan.
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Except as specifically amended hereby, the Plan shall remain in full force
and effect as prior to this Second Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to
be executed as of the day and year first above written.
C & D TECHNOLOGIES, INC.
By: /s/ K.D. Burgess
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Title: VP Human Resources
---------------------------------
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